Asos has returned to profit despite the cyber attack that disrupted the fast-fashion retailer last month, with its chief executive dismissing the incident as "not a big thing".
The London-listed firm said its decision to temporarily halt certain marketing and customer-facing activities after the breach caused a "short-term disruption" to trading, estimated at between two and four per cent of the group's gross merchandise value (GMV) in October.
Financial impact of the breach
The retailer typically generates £200m in GMV each month, placing the financial impact of lost sales from the incident at somewhere between £4m and £8m. Chief executive José Antonio Ramos expressed confidence that the group's ongoing recovery efforts had not been knocked off course by the attack.
Speaking to journalists on Thursday, he said: "We're confident that this [impact] is going to dilute over time. So I don't think that it is such a big thing, to be honest."
Return to profitability
Ramos has been spearheading a turnaround strategy aimed at reducing excess stock, streamlining the supply chain and improving margins since he took the helm in June 2022. Shareholders have been encouraged by the business's adoption of artificial intelligence to anticipate emerging fashion trends, echoing its founding ethos as a go-to destination for celebrity-inspired clothing.
Asos returned to profitability in the year ending August, recording a £24.4m pre-tax profit, contrasting sharply with the previous year's £282m loss. The retailer's £46.4m adjusted loss before tax outperformed analysts' forecasts of £61m, while turnover declined nine per cent to £2.2bn, matching market predictions.
Growth strategy and AI expansion
Ramos said the fast-fashion retailer has executed a "strategic pivot towards growth, building on the progress made through our transformation to date". The chief executive highlighted the company's eight per cent GMV growth in womenswear during the second half of the year, although he acknowledged the firm's menswear category "is still in recovery".
Ramos revealed Asos will expand its deployment of AI through a new 'Stylist' tool. He said: "Imagine a store that is different for every customer, every time they visit, built around their own wardrobe and style, and shared with the friends, stylists and creators they love."
Cyber attack details and recovery
Last month, Asos's share price fell 12 per cent following claims by a previously unidentified group that they had infiltrated the company's systems and obtained access to customers' personal information. The hackers secured an employee's login credentials by impersonating a trusted contact, the company subsequently confirmed, though it reassured customers that their payment information remained secure.
Asos informed shareholders on Thursday that the incident has not had a lasting impact on its sales performance, with growth remaining largely stable in recent weeks despite the disruption from the attack. Ramos said: "We are confident that we are in a significantly better position now to avoid that this happens again. Obviously it's impossible to say what is going to happen in the future, but we are confident that we have taken the right measures, in our collaboration with cyber experts."
Asos is based in London with its key fulfilment centre in Barnsley, South Yorkshire.
